-LRB- CNN -RRB- -- Judging solely by the headlines , one might conclude that China 's economy is finally starting to hit a wall . After several decades of near double-digit annual growth , gross domestic product rose by a relatively cool 7.5 % in this year 's first half . Property prices are down . So is investment in factory capacity and real estate .

But companies that interpret slower GDP growth to mean that business opportunities in China and other emerging markets will begin to fade are making a serious mistake . The consumer class is still growing rapidly in key emerging markets , and the competition from savvy , extremely capable domestic companies is intensifying .

In China 's case , the lower GDP growth rate actually reflects an important structural shift in the economy -- from growth that is driven by extraordinarily high fixed investment fueled by loans from government-owned banks to growth that is driven by private consumption . This transition has been a top goal of the Chinese leadership as it seeks more balanced and sustainable economic growth .

China illustrates an important phenomenon found in many emerging markets . What many gloomy economic reports miss is that private consumption continues to rise . This is fueled by steady , rapid growth in the country 's middle-class and affluent households , which in China we at The Boston Consulting Group -LRB- BCG -RRB- regard as having annual disposable incomes of at least $ 12,500 . Since 2010 , people living in middle-class and affluent households surged from 10 % of China 's population to 25 % . In just another three years , this share is projected to leap to 35 % , according to BCG analysis .

Some of the sharpest consumption growth in China is occurring among the upper middle class , which we classify as households with annual disposable household incomes of $ 25,000 to $ 50,000 . The population in this income segment has been has been rising 12 % annually . Astonishingly , Chinese upper middle class are projected to account for 5 % of global consumption by 2020 . These consumers are the sweet spot for many international companies because they tend to sharply accelerate their consumption in such product categories as automobiles , premium personal-care products , fresh foods , financial services , and travel .

While companies like the e-commerce giant Alibaba generate the most buzz , it is only one of many innovative companies prospering from the rapid growth of China 's middle class . At BCG , we have been tracking a particularly impressive group of hard-charging competitors that we refer to as `` local dynamos '' -- emerging market-based companies that are staying home and conquering their domestic markets .

The dynamos move at breathtaking speed , have formidable business models for catering to local consumers , are highly adaptable and are remarkably adept at taking advantage of digital technologies . They have averaged compound annual revenue growth of 28 % annually over the past four years , compared with 5 % annual growth among S&P 500 companies .

Eleven of the 50 dynamos that we identified globally in a recent report are consumer goods companies -- more than from any other sector . This reflects the opportunities created by surging consumption in emerging markets . Ten of the 50 are based in China . They span sectors from banking and food retailing to consumer electronics .

Home Inns & Hotels Management illustrates how Chinese dynamos can operate successfully while moving at warp speed . Home Inns saw a huge opportunity in the underserved and highly fragmented market for budget hotels . From 2008 to 2013 , it increased its number of hotels from 500 to more than 2,000 , in part through an aggressive strategy of franchising . It also boosted the number of cities served from fewer than 100 to 300 . With revenues of $ 1 billion in 2013 , Home Inns controls nearly 25 % of China 's branded economy-hotel segment .

Xiaomi , another dynamo , demonstrates the digital prowess of China 's new breed of consumer-product companies . Xiaomi relies entirely on e-commerce to sell its affordable smart phones , which are priced at between $ 100 and $ 300 .

To reach China 's Internet-crazed youth , Xiaomi uses a variety of popular social media to extensively market its products and solicit customer feedback , which it incorporates when designing and improving its devices . After just three years in operation , Xiaomi reached $ 5 billion in revenue in 2013 and sold more smartphones in China -- nearly 19 million -- than Apple . Xiaomi passed Samsung in the second quarter of 2014 as China 's top smartphone brand .

Even if companies have little interest in the China market , the local dynamos should be on their radar because they are potential future global competitors . A number of companies on BCG 's 2014 list of `` global challengers '' -- fast-growing companies based in emerging markets that are becoming global leaders or have the potential to do so -- have followed the path of leveraging their dominance in domestic markets to go global .

Twenty-nine of the 100 challengers on the 2014 list are Chinese , including appliance maker Haeir Group , automaker Geely International , and medical device producer Mindray Medical International . Prominent examples from other emerging markets are Chilean wine maker Concho y Toro , Chinese appliance marker Haier Group , Mexican cellular phone giant America Movil , Philippines fast-food conglomerate Jolibee , and Indian vehicle companies Bajaj Auto and Mehindra & Mehindra .

Whether one sees China and other emerging markets as the world 's biggest growth opportunities -- or as the source of potential threat -- do n't let slower GDP statistics distract you into pulling back . The battle for a share of the growing consumer class is underway now and will grow more fierce .

Read this : The 10 hottest startups in Asia

Read this : Want to get rich ? Move here !

More from Virtual Think Tank

The opinions expressed in this commentary are solely those of Jeff Walters .

@highlight

Jeff Walters : Consumer class still growing rapidly in key emerging markets

@highlight

Gloomy economic reports miss that private consumption continues to rise

@highlight

Many innovative companies prosper from rapid growth of China 's middle class